Folk2Folk eyes £100m from institutions as it expands nationally
Folk2Folk is seeking to attract between £50m and £100m in institutional investment this year, as it shifts its lender base towards a hybrid model of both retail and institutional investors.
As a result, the company will no longer identify as a peer-to-peer lending platform, but will describe itself as a marketplace lender instead.
The lender has also announced its plans to expand into regions across the UK, not just in the South West of England.
However, Roy Warren (pictured), managing director of Folk2Folk, told Peer2Peer Finance News that it would not be abandoning its roots as a rural lender with retail funding.
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“We’re broadening our outlook really, and broadening the ability for us to grow and expand,” he said.
“We’ve no intention of abandoning our loyal retail customers and we will continue to have that rich amalgam of retail funds and institutional funding going forward.”
At the time of writing, Warren said that Folk2Folk is approximately 95 per cent funded by retail investors. It aims to shift this to a 60/40 split, with institutional funding representing the larger value.
The platform is in talks with a number of institutional investors at the moment, but Warren said that his priority is finding the right institution which matches Folk2Folk’s values.
“We’re not a desperate company,” he added. “We’re strong.
“We had an extremely successful year in a year of extreme adversity. We maintained our track record of no lender losses, and our arrears and bad debt position is very low.
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“That underlines the strength of our model and that should give lenders significant confidence.”
Despite the Covid-19 pandemic, Warren said that Folk2Folk has maintained a strong pipeline of loans, including many from return borrowers.
“We have a substantial pipeline over the next few months,” Warren revealed.
“During Covid we stayed open, stayed positive and it has yielded good results.”
Read more: Folk2Folk exceeds £400m in lending
